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Bally’s (BALY - Free Report) is a Zacks Rank #5 (Strong Sell) that is a gaming, hospitality, and entertainment company that engages in casinos, resorts, and online gaming businesses.
The stock did fairly well in 2020, but is now trading 60% off the 2021 highs. Investors are now wondering if its time to buy or if the stock has more room to go lower.
While there might be a bargain coming for investors soon, a recent earnings report has the stock dragging lower.
About the Company
Bally’s is headquartered in Providence, RI and employs almost 9,500. The company was founded in 2004 and in 2020 changed its name from Twin River Holdings to Bally’s.
The company's properties include Twin River Casino Hotel, Tiverton Casino Hotel, Hard Rock Hotel & Casino, Casino Vicksburg, Dover Downs Hotel & Casino, Casino KC, Golden Gates Casino, Golden Gulch Casino, Mardi Gras Casino and Arapahoe Park racetrack.
The stock has a Zacks Style Scores of “F” in both Growth and Momentum, while sporting a “C” in Value.
Q4 Earnings and Estimates
Bally’s reported earnings in late February, missing expectations by 96%. Revenues missed as well, coming in at $547.7M v the $577M expected.
The miss was the fourth straight since the Bally’s blew out their numbers in Q1 of 2021.
Over the 60 days, estimates have plummeted. For the current quarter, we see seen a drop from $0.40 to -$0.44. For the current year, estimates went from $1.72 to -1.07.
In January the company received a buyout off from Standard General at $38 a share. The hedge fund already owns over 20% of the company and wants to take the company public.
While the board continues to examine the offer, the stock is trading a 20% discount to the offer. So, the market clearly thinks this deal won’t happen.
Technical Take
Investors might be thinking they are getting a deal because the stock has fallen so much, but they should take caution. The stock is in a clear down trend and not far off 2022 lows. While there might be some upside on a potential buyout, the stock is still technically weak.
Additionally, the stock is trading under the 50-day moving average and 25% below the 200-day moving average.
If the stock were to fail the $28 level, the January lows of $26.11 would likely be taken out.
In Summary
Bally’s continues to struggle in a saturated gambling market that has a lot of new players on the scene. Until the company turns the earnings story around, investors should avoid the stock.
For now, a better choice in the gaming space might be Boyd Gaming (BYD). The stock is a Zacks Rank #3 (Hold) that has held up well in the recent market sell off.
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Bally's (BALY)
Bally’s (BALY - Free Report) is a Zacks Rank #5 (Strong Sell) that is a gaming, hospitality, and entertainment company that engages in casinos, resorts, and online gaming businesses.
The stock did fairly well in 2020, but is now trading 60% off the 2021 highs. Investors are now wondering if its time to buy or if the stock has more room to go lower.
While there might be a bargain coming for investors soon, a recent earnings report has the stock dragging lower.
About the Company
Bally’s is headquartered in Providence, RI and employs almost 9,500. The company was founded in 2004 and in 2020 changed its name from Twin River Holdings to Bally’s.
The company's properties include Twin River Casino Hotel, Tiverton Casino Hotel, Hard Rock Hotel & Casino, Casino Vicksburg, Dover Downs Hotel & Casino, Casino KC, Golden Gates Casino, Golden Gulch Casino, Mardi Gras Casino and Arapahoe Park racetrack.
The stock has a Zacks Style Scores of “F” in both Growth and Momentum, while sporting a “C” in Value.
Q4 Earnings and Estimates
Bally’s reported earnings in late February, missing expectations by 96%. Revenues missed as well, coming in at $547.7M v the $577M expected.
The miss was the fourth straight since the Bally’s blew out their numbers in Q1 of 2021.
Over the 60 days, estimates have plummeted. For the current quarter, we see seen a drop from $0.40 to -$0.44. For the current year, estimates went from $1.72 to -1.07.
Bally's Corporation Price and Consensus
Bally's Corporation price-consensus-chart | Bally's Corporation Quote
Buyout?
In January the company received a buyout off from Standard General at $38 a share. The hedge fund already owns over 20% of the company and wants to take the company public.
While the board continues to examine the offer, the stock is trading a 20% discount to the offer. So, the market clearly thinks this deal won’t happen.
Technical Take
Investors might be thinking they are getting a deal because the stock has fallen so much, but they should take caution. The stock is in a clear down trend and not far off 2022 lows. While there might be some upside on a potential buyout, the stock is still technically weak.
Additionally, the stock is trading under the 50-day moving average and 25% below the 200-day moving average.
If the stock were to fail the $28 level, the January lows of $26.11 would likely be taken out.
In Summary
Bally’s continues to struggle in a saturated gambling market that has a lot of new players on the scene. Until the company turns the earnings story around, investors should avoid the stock.
For now, a better choice in the gaming space might be Boyd Gaming (BYD). The stock is a Zacks Rank #3 (Hold) that has held up well in the recent market sell off.